Last week, the Federal Airports Authority of Nigeria (FAAN) commissioned the multi storey car park at the Murtala Muhammed International Airport, Lagos, with so much fanfare.
Without doubts, the airport was in dire need of a befitting car park. With the speed at which the facility was completed, one would think that other facilities would get same speedy attention.
Anyway, the multi storey car park is said to be financed by a commercial Bank and one that is heavily linked with a former female Minister of Aviation in a deal that would be very difficult to unravel except for those that are heavily involved in the deal.
The essence of this article is not whether or not the car park was built but just to bring out the contradiction in the entire arrangement that asked the concessionaire (The bank which financed the project and the former Minister who is said to be heavily involved in the project) to operate the facility for 30 years for them to recoup their investment.
This came against the backdrop of serious opposition to the 35 years concession agreement between FAAN and Bi-Courtney Aviation Services Limited that led to the construction of MMA2.
Many who spoke to the reporter said unlike MMA2, the car park deal is totally shrouded in secrecy as no one knows what it cost the financiers to build the facility and the duration of the concession.
It would be recalled that the same Minister opposed the operators of MMA2 and was alleged to have conspired to ground the terminal.
he ex-Minister’s love for impunity in the sector was legendary and helped in no small measure to corner all the juicy contracts in the sector.
She still has her imprints in every big pie, using fronts to establish so many firms in the sector.
What is the sharing formula between FAAN and the concessionaire? Is it a case of replacing one bad concession with a more terrible one? Nigerians want to know how the arrangement was conceived. Anything short of this is tantamount to corruption.
I am a proponent of airports concession but the desire to go about it in secrecy is what has made Nigerians not to be excited with the proposed concession of many of the aerodromes that the government has given its nod.
Infact, the wider process of ‘concession’ of nearly half of Nigerian airports would have far reaching effects-not least in the domain of airport competition.
For instance, increased competitive forces have pushed airports of all sizes to fight for route development and traffic growth to become leaner and more efficient, to boost airport service quality and to find optimal means of financing investments.
Privatisation of airport infrastructure always meets with some resistance in many parts of the world including Europe. Seventy-eight per cent of fully public airports in Europe have been corporatised. They function as independent commercial entities more than public utilities.
Fraport Greece (73 per cent owned by the Frankfurt based airport operator Fraport AG and 22.6 per cent by Copelouzos Group) recently commenced the 40 year concession for managing and developing 14 regional airports on the Greek mainland and popular holiday island which is a mammoth investment for the country’s infrastructure and economically vital tourism sector.
In most places, airports are privatised because of pressure on the governments to reduce spending; airports are commercially/business oriented, need for streamlined structure to exploit changing markets, and not least proactive business approach is needed to keep pace with rapidly changing aviation industry.
Airports concession could bring negative outlook if policy makers adopt short term outlook. It could lead to possible reluctance to invest, complicated transition that are disruptive and intimidating to airport staff.
There is also the need to maintain public accountability and gyration of airport charges in upward direction.
With concession, airport will develop new strategies in order to maximise profit and reduce risks.